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Business & Strategy

Switching wireless

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Wireless phone companies in the US don’t have to provide decent customer service because they hold your mobile phone number hostage. If you want to switch services, you will lose your phone number.

My cell phone is my business phone. It’s the number that’s posted on this site, printed on my business cards, and in my email signature. If I want to change providers, either because I’m unhappy with Cingular or because I want a service they don’t offer, it will have a serious impact on my business.

A law was passed years ago that requires wireless companies to make your phone number portable between carriers, but the phone companies have successfully delayed the start date of the law up until now.

There’s a reason for this: churn. It’s the bane of telecommunication companies. When I worked at MCI, I discovered that each month as many as 20% of long-distance subscribers switch from one long distance service provider to another. Anytime something that seems like a better deal comes along, people dump their carrier for another.

One of the things my business unit was trying to do was make it more difficult for people to switch over. The theory was that f your phone number changed every time you switched providers, you wouldn’t switch very often. Of course, we couldn’t change keep your phone number just because you switched long distance providers, so we bundled Internet access with high-value accounts. Then if you switched to another long-distance provider, you’d lose your email address.

But mobile phone companies are able to tie up your phone numbers. This makes them more immune to churn. And if you have a barrier that prevents consumers from going to the competition, you don’t need to provide as good as service.

Everything is now changing. Wired News reports "starting Nov. 24, 2003, most of the United States' 135 million wireless subscribers will be able to keep their cell-phone numbers even if they switch carriers." (Wired News: Switching Doesn’t Have to Sting)

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